German economy minister says no alternative to Russian gas

Reuters Staff

3 Min Read

* Gabriel says unlikely Russia will stop delivering gas

* Says BASF, RWE deals with Russia “unproblematic”

BERLIN, March 28 (Reuters) - German Economy Minister Sigmar Gabriel said there was “no sensible alternative” to Russian natural gas imports and it was unlikely Russia would stop deliveries because of the crisis over Ukraine, a German daily reported on Friday.

“Even in the darkest hours of the Cold War Russia respected its contracts,” the Neue Osnabruecker Zeitung reported Gabriel, who is also energy minister and vice chancellor, as telling an energy forum.

Europe’s biggest economy is heavily reliant on Russian gas, which accounted for about a third of its gas imports last year, BDEW figures show. Germany’s top utilities E.ON and RWE receive most of their gas from Russia’s state-controlled gas producer Gazprom.

Russia’s seizure of the Crimea region and its threat to cut off gas to Ukraine, a transit route to the rest of Europe, has prompted European leaders to consider strategies to curb the bloc’s energy reliance on Russia.

Gabriel also said that two current business deals with Russia by German companies BASF and RWE, which have been of media interest since the Ukraine crisis broke, were “company decisions” and “essentially unproblematic”, according to the newspaper.

RWE is to sell its oil and gas unit DEA to investors led by Russia’s second-richest man Mikhail Fridman. Senior German politicians have criticised the deal, warning Germany’s energy dependence on Russia was already too high.

German gas and oil exploration company Wintershall, owned by BASF, is due later this year to hand its European gas trading and storage activities to Russian partner Gazprom under a swap agreement that will give it more shareholdings in Siberian gas fields.

The newspaper said Gabriel also told the forum that Europe’s now shelved plan to build the Nabucco pipeline from the Caspian Sea to provide natural gas and make Europe less reliant on Russia was not a serious option to ensure energy security given that Iran would have been “at the end of the pipeline”.

The project was shelved last year although EU officials say it could still be built one day if more Caspian gas becomes available. (Reporting By Sarah Marsh; Editing by Susan Fenton)